Workers, workers everywhere and not a job to spare

A worker is shown at the PCL fabrication plant in Nisku, Alta. The conflicting narratives of underemployed graduates and sector-specific skills shortages have led to conclusions of a skills mismatch in Canada, but some say the real culprit may be a lack of reliable data upon which to base more accurate economic projections.

Photograph by: SHAUGHN BUTTS/Postmedia News
, Postmedia News

OTTAWA – For Stephen Tarrant, fears of a looming skills shortage in Canada, particularly in the lucrative natural resources sector, are downright laughable.

After six years of expensive, intensive post-secondary training, Tarrant graduated last year from Memorial University with a degree in economic geology, a published honours thesis and several terms of paid fieldwork under his belt.

But in the year since leaving school, the 24-year-old has learned a harsh truth: a degree tailor-made for the much-touted mining and energy sector does not guarantee a job in it.

“I’ve probably had, without exaggeration, 300 applications sent to different companies across the country and basically heard nothing back,” a weary Tarrant said by phone earlier this month. He had just finished a long day serving Christmas shoppers for minimum wage at a Target store in St. John’s.

Tarrant’s retail reality – he holds another part-time gig at a Starbucks location – is particularly bitter given the seemingly never-ending talk of skills shortages in a sector advertised as the future of Canada’s economy. For him, each news story or government announcement on the topic feels like the twist of a knife.

“I’m just flabbergasted,” he said. “I don’t understand how they’re pumping this into students when I couldn’t buy a job right now if I wanted one.”

The conflicting narratives of underemployed graduates and sector-specific skills shortages have led to conclusions of a skills mismatch in Canada, but with more anecdotes like Tarrant’s surfacing, some experts posit the disconnect lies somewhere else entirely.

Rather than a mismatch of skills, the real culprit seems to be a lack of reliable, empirical data upon which to base more accurate economic projections.

Derek Burleton, deputy chief economist with TD Economics, exposed Canada’s dearth of job force data earlier this year with the release of a 55-page report questioning claims of an impending skills crisis.

“We were forced to scratch together a lot of different sources,” he said, noting Canada lacks a comprehensive database of job vacancies, and relies heavily on self-reporting from industry groups and surveys of online job banks.

As a result, “we were not able to say if the (skills) mismatch is getting worse,” he said.

That’s cold comfort for people like Tarrant, who are left with crushing disappointment and student debt when economic projections based on assumptions and estimations are presented as fact. In his case, a drop in commodities prices dissolved job prospects he had been banking on. Since then, Tarrant says, industry experts have told him “it will be years before the economy is able to support new geologists.”

While market forces play a significant role in determining whether economic predictions will come to pass, Burleton said better data would vastly improve their accuracy.

Universities, which have the capacity to closely track graduates, should provide alumni information to Statistics Canada, he said, which should then cross-reference with income tax data to determine how many graduates are finding jobs in their fields.

As things stand, Canada lags behind the United States when it comes to collecting labour force data, said Philip Cross, former chief economic analyst for Statistics Canada and a senior fellow at the MacDonald-Laurier Institute.

“We don’t put the money into it that the Americans do,” he said.

In determining existing and future job vacancies, it isn’t enough to come up with a ballpark figure, Cross said, the root cause of job openings also needs to be taken into account.

“When you look at employment changes, it’s important to know if the change is due to more hiring, less people quitting, or more people on layoffs,” he said. “In the U.S., they have this terrific survey where they go out and they measure those three components.”

In Canada, the finer points of the data are not addressed. Statistics Canada only began keeping track of job vacancies in 2011, Cross said, mostly through online postings and employer surveys, a method Burleton contends is flawed.

Employers have a “vested interest” to exaggerate trouble finding qualified applicants, he said, because it provides incentive for governments to continue funding training programs. Both Cross and Burleton said business is not pulling its weight when it comes to training workers, noting Canadian companies have one of the lowest rates of training investment among countries in the Organisation for Economic Co-Operation and Development.

“Employers use computer programs to screen out people, and frankly, they don’t do a very good job of it,” he said.

Pedro Antunes, director of national and provincial forecasts for the Conference Board of Canada said overall projections of macroeconomic conditions are reasonably reliable, but problems arise when the details that are available aren’t passed on to people who really need them, like Tarrant.

Antunes said he believes data supports claims of skills shortages in Canada’s resource sector, but growth is on the construction, not the resource extraction, side.

“People say we’ve become a resource economy, but that’s not true,” he said. “Resource extraction itself, it’s very productive, highly capital intensive and employs very few people.”

Extraction accounts for 100,000 jobs in Canada’s economy, Antunes said, while construction in the sector accounts for 500,000.

That might explain why Tarrant estimates that out of 200 students in his graduating class, two-thirds have been unable to find jobs in their field. And hundreds more are set to graduate this year.

Incomplete and misconstrued data combined with overly broad criteria to determine statistical “success” in the job market is encouraging young people to pursue university degrees they don’t really need, he said.

For example, if a university graduate lands a job driving a truck, or working at Target, the data collection agencies count that as a win – an employed university graduate.

“The people in the university system consider him a success story and so does Stats Canada,” Coates said. The graduate, however, likely views it very differently. Meanwhile employers are increasingly viewing university degrees as a filtering mechanism for applicants, Coates said, regardless of whether the job requires it.

Like Burleton, Coates says there is a great need to reform Canada’s data collection process. He has been a vocal critic of universities, which, he says, are not fulfilling their responsibility to future students by tracking grads and releasing detailed information on job prospects.

And there is one major reason he suggests institutions are reluctant to create a clearer picture of the job market: It’s likely not a pretty one.

“I think sometimes we’re not so confident we want the answer,” he said.

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A worker is shown at the PCL fabrication plant in Nisku, Alta. The conflicting narratives of underemployed graduates and sector-specific skills shortages have led to conclusions of a skills mismatch in Canada, but some say the real culprit may be a lack of reliable data upon which to base more accurate economic projections.

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